Countering The Prosperity Fable

Tired of hearing as if a broken record the same line from the Bush team about how well our economy is growing and creating new jobs? Feeling at a loss at how to counter this wash, rinse and spin of economic statistics? Want to know what to say to your Republican relatives at the family picnic this summer? Here are some sobering facts about the U.S. economy under George W. Bush and his cronies:

*Despite reasonably solid overall economic growth in the U.S. since the recession in 2001, average incomes after adjusting for inflation have fallen. From 2001 to 2004, the average American income fell 2.3%, after increasing 17.3% from 1998 to 2001, and 12.3% from 1995 to 1998.

*The median, or “typical”, household income in 2004 was $43,200, up just 1.6% since 2001, a rate of growth slower than the inflation rate, which means that the median household income actually fell during Bush’s first term in office.

*The number of Americans living in absolute poverty (i.e. below the Federal Poverty Level) rose by 5.4 million between 2001 and 2004. The number of children living in poverty rose by 1.4 million. Somewhere around 38-40 million Americans live in absolute poverty, 9-10 million of them children. Remember that the FPL for a 4-person household is presently defined as a household income less than $20,000 per year.

*The number of children living in “severe” poverty, with household incomes less than 50 percent of the FPL, has risen dramatically over the past five years. Almost 1 in 5 children under age 18 in the United States now lives in poverty; 1 in 10 in severe poverty.

*Despite annual rates of economic growth between 3 and 4 percent since 2001, real hourly wages, after adjusting for inflation, have been flat since 2001. In essence, American workers, who are the bakers of this growing economic pie, are taking home smaller and smaller slices. Most of the economy’s gains are going to shareholders and to those people, overwhelmingly white males, at the top of the corporate ladder.

*While real wages remain flat, the costs of housing, medical care, gasoline, and food have risen by 11 percent since 2001. Many American families are trying to make up the difference by borrowing.

*The debt of the “typical” American household rose by 33 percent from 2001 to 2004, after adjusting for inflation.

*The minimum wage, which has not increased since 1997 and still stands at $5.15 by federal law and in two-thirds of states, is at its lowest level in terms of buying power in half a century. Fifty years ago the minimum wage stood at about half of the average American wage; today it has fallen to just less than a third.

*The earliest numbers from 2005 are even worse. Despite that 2005 marked the fourth year of an economic expansion, the median worker’s wage fell 1.3 percent. Even among the college-educated, the average wage was stagnant when adjusted for inflation. Only wage earners at the 95th percentile of American society saw income gains, though modest at 0.6% above the rate of inflation.

*Median net worth grew at only 1.5% from 2001 to 2004 after adjusting for inflation, down from a 10.3% increase during the period 1998 to 2001.

*The share of national income going to wages and salaries is the lowest since 1929. And we know what happened next.

The economy may be doing fine, but the people in it are not.

Dr. Todd is a pediatrician and political columnist living in Eugene. Comments are welcomed at: doctortodd@att.net.